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Minneapolis undercuts the idea that economic prosperity leads to racial equality

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But the prosperity fueled by the region’s Fortune 500 companies and progressive policies has not translated into economic equality. Instead, the wealth gap between Minneapolis’s largely white population and the city’s black residents has deepened, producing some of the nation’s widest racial disparities in income, employment and homeownership.

Such disappointments offer cautionary notes for those promising change in Minneapolis and other areas of the country in the aftermath of protests against police brutality and systemic racism — and raise questions about how far the movement to shift funding from police departments to other services can go toward delivering racial justice.

The shortcomings have given rise to an urgent debate about where Minneapolis went wrong and what measures would bring better results. Economists, lawyers and civil rights advocates in the Twin Cities say progressive tax policies could not make up for other aspects of structural racism, such as access to credit or jobs. Some say investments in affordable housing in low-income neighborhoods deepened segregation and poverty. Others argue for better enforcement of federal laws to combat discrimination in lending, employment and housing.

“Minneapolis seems to have been blindsided by these realities. They relish the fact that they are seen as this bastion of progressivism,” said Marvin Owens Jr., senior director of economic programs at the NAACP, which released a report in December highlighting the Twin Cities’ growing racial economic disparities. “The warning was if we don’t address these issues, this was a tinder box that would explode.”

The typical black family in the Twin Cities earned $39,851 in 2017, lower than the median income for African Americans nationally and less than half as much as the typical white family income of $82,371, which is much higher than white households nationally, according to the NAACP report. A quarter of black households lived in poverty, five times the poverty rate for white households.

Those enduring disparities, which erupted onto the national stage after George Floyd was killed in the custody of Minneapolis police last month, highlight the flawed premise, touted by President Trump and other Republicans, that economic prosperity is a remedy for racial inequality.

Having the “strongest economy in the world” is “the greatest thing that can happen for race relations, for the African American community,” Trump said amid protests after a video emerged of an officer kneeling on Floyd’s neck for more than eight minutes.

But the outcome for black residents in Minneapolis and St. Paul also undercuts the liberal argument that spending on progressive policies can create systemic change.

Civil rights and community leaders in the Twin Cities say racial equity cannot be achieved without gaining a greater understanding of how the country’s racist foundations continue to affect the criminal justice, education and health systems. Too often, they say, progressive programs focus on “fixing” something perceived to be wrong with the black community rather than fundamentally reshaping underlying inequities in society.

“In order for Minneapolis and the region to actually change the trajectory for people of color, whites are going to have to be uncomfortable,” said Gary Cunningham, chief executive of Prosperity Now, a national nonprofit focused on racial wealth equity. “They are going to have to have conversations about how their privilege maintains the status quo and how resources and wealth are distributed in their communities.”

Cunningham, who grew up in Minneapolis and served as the city’s associate schools superintendent and deputy civil rights director, said that for too long, there has been a “huge disconnect between the progressive policies that are put in place and the outcomes that they get.”

“Good intentions don’t change the conditions for young boys and girls growing up in north Minneapolis,” he said.

Black residents, who account for less than a fifth of the Twin Cities’ population, are worse off today by some measures than they were 20 and 30 years ago, even as the fortunes of their white counterparts held steady or improved, according to census data.

Nationally, the economic gulf between black and white Americans has changed little since a federal commission in 1968 identified “white racism” leading to “pervasive discrimination in employment, education and housing” as the cause of uprisings in African American communities.

Black residents in the Twin Cities are younger and more likely to be immigrants than white residents, but these differences still do not fully explain the racial economic disparities, according to a 2016 analysis by the Metropolitan Council, a regional government agency. Such disparities existed before the influx of immigrants from Somalia, Ethiopia and Liberia, leading the agency and other researchers to conclude that “systemic discrimination is part of the equation.”

Minnesota’s progressive reputation was cemented nearly five decades ago when a Time magazine cover featured then-Gov. Wendell Anderson on a fishing trip, with a headline touting “The Good Life.”

Anderson, a Democrat, had worked with the Republican-controlled legislature to pass laws known as the “Minnesota Miracle.” Among the key provisions: a redistributive tax policy introduced in 1971 that required wealthy communities in the Twin Cities region to share their commercial property tax revenue with the poorest areas. Income and sales tax revenue from rich suburbs across the state also was shared with less-affluent cities and rural communities to fund schools, police and housing.

The whole idea was we are going to invest in the future so everyone does better,” Cunningham said.

It would be the beginning of a suite of policies that over subsequent decades increased investments in housing, schools and small businesses in disadvantaged communities.

But the main beneficiaries of many of the policies were working-class whites, said Samuel L. Myers Jr., an economist at the University of Minnesota whose research on what he calls “the Minnesota paradox” focuses on the problem with race-neutral remedies to racial inequality.

In the 1970s, following civil unrest over systemic racism and a lawsuit on school segregation, the Twin Cities embarked on a new set of reforms, building subsidized housing for low-income families throughout its wealthier white communities, said Myron Orfield, a law professor at the University of Minnesota who leads the Institute on Metropolitan Opportunity.

But political and philanthropic leaders abandoned the region’s well-known integration policies in the 1990s in favor of directing additional tax dollars to finance social services, housing and schools in low-income communities of color, he said.

“There’s nothing wrong with gigantic redistributive programs, but they don’t overcome the problems that segregation causes,” said Orfield, a former civil rights attorney. “The structures of people’s lives did not change — they didn’t have better jobs, they didn’t live in safer neighborhoods, they weren’t more likely to graduate from high school. If you allow segregation to get worse, inequality is going to get worse.”

Even more state aid poured into poor communities in 2013, when then-Gov. Mark Dayton raised taxes on the wealthiest Minnesotans. The Democrat and Target fortune heir had campaigned to “Tax the Rich!” — saying everyone should pay their “fair share” to keep society “functional.” The income tax rate, already fairly high for top income earners compared with other states, increased from 7.85 percent to 9.85 percent for individuals making more than $150,000.

And yet today, the region lands near the bottom nationally when it comes to racial economic disparities, especially homeownership.

Despite a slew of programs to help first-time home buyers, only a quarter of black residents in the Twin Cities own their homes, compared with more than three-quarters of white residents — and much lower than the national black homeownership rate of 42 percent.

Orfield said one of the reasons the programs have not significantly boosted black homeownership is that they encourage prospective home buyers to invest in segregated, low-income neighborhoods where property values have depreciated over time.

Others say the state’s homeownership assistance programs failed to close the racial gap because many black families lack the financial assets to participate.

The average house in north Minneapolis goes on the market for about $250,000, whereas the average black resident qualifies for a home loan of about $180,000, according to Steven Belton, president and chief executive of the Urban League Twin Cities. Government assistance typically covers only half the gap, which leaves prospective home buyers having to rely on their personal network or net worth to make up the difference, he said.

“For white people, the homeownership program is working really well,” Belton said. “The policy doesn’t really address the problem: If we know the disparity is in black homeownership, the dollars should be targeted toward African Americans.”

Black leaders say programs targeting equity tend to focus on neighborhoods — not race.

“A state like ours is so hesitant to assign a race lens to our incentives that we too often defer to geography,” said Tawanna Black, founder and chief executive of the Center for Economic Inclusion. “Attaching Zip codes as qualifiers is not enough. Part of the challenge is this isn’t a region or state that has gone above and beyond to create policies to drive racially equitable results.”

In addition to investing in homeownership programs, Minnesota has created financial incentives for the construction of affordable housing that critics say end up exacerbating segregation. Each year, tens of millions in local and federal subsidies are directed toward poor black, Latino and Southeast Asian neighborhoods in the Twin Cities, Orfield said.

Affordable housing developments are more likely to be approved in poor, minority neighborhoods where they qualify for more government subsidies, enabling developers to turn bigger profits, Orfield said. “The city and big foundations put extra money on the table,” he said. “If you build in a white neighborhood, you have to go to 15, 20 public meetings to get the white neighbors not to have a stroke.”

On the flip side, Orfield’s research also shows that developers have taken advantage of public subsidies to rehabilitate historic structures in gentrifying Minneapolis neighborhoods and turn them into artists lofts with yoga studios, rooftop fire pits and skyline views — accommodations that draw overwhelmingly white tenants. These developments represent the highest end of “affordable housing” in the Twin Cities — too expensive for most low-income residents to afford with government housing vouchers, Orfield said.

Minneapolis drew national attention for its 2018 move to eliminate single-family zoning, billed as another progressive policy to remedy racial disparities. But Orfield said simply building duplexes and triplexes is unlikely to promote integration because the new construction may not be affordable. Some of the densest neighborhoods in the city are the whitest, he said.

Not everyone agrees that racial integration is the solution to inequality.

Myers, the University of Minnesota economist, said racial economic disparities are a direct result of government-sanctioned redlining and urban planning that limited or wiped out black wealth, and also a result discrimination in so many facets of American life, including employment and lending. Stricter enforcement of federal civil rights laws should be prioritized, including funding for such oversight, he said — and discrimination should be criminalized.

“The policies advanced by progressives in Minnesota have focused on credit repair, homeownership training and other factors that assume that the problem of racial disparities in homeownership are due to black deficiencies,” Myers said. “The liberal and progressive policies tend to work to help improve the capacities of minorities without changing the underlying structures that are in place that created the disparities to begin with.”

He said it’s hard for progressive Minnesotans to accept that ongoing discrimination is a cause of persistent racial disparities. “The main thing that explains the Minnesota paradox is the fact that, unlike Mississippi or Alabama, where there are overt racists, racism in Minnesota is never open or explicit.”

Now protesters across the country are pushing for another progressive policy — defunding the police, a step that’s gaining traction in Minneapolis and other cities.

Most members of Minneapolis’s Democratic-led city council were quick to signal that they intend to dismantle the city’s police department as other cities such as Los Angeles and New York announced cuts to the police budget so money could be redirected to black communities.

Some activists are skeptical that dismantling the Minneapolis police would channel funds into improving the economic prospects of black residents. After all, the Minnesota legislature failed to do so when the state saw a $1 billion revenue surplus in 2016, said the Urban League’s Belton.

The legislature appropriated $35 million to address racial inequities, but lawmakers decided that “equity included every community and their mother,” Belton said.

Every marginalized group got in line for the money, Belton said. The Urban League ended up splitting $4.2 million with four other nonprofit organizations, he said, a circumstance that yielded too little to make a significant difference.

“If you look at the numbers overall, there was zero impact,” Belton said. “We pat ourselves on the back for being progressive in a state that extols the virtues of diversity, equity and inclusion, but we have no reason to be self-congratulatory.

“Minnesota works for white people — at the expense of black people.”

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These Are Top Consumer Complaints, NY AG Says

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Attorney General Letitia James highlighted some of the top scams New Yorkers are facing to kick off National Consumer Protection Week.

Citing the COVID-19 pandemic, James said that Internet-related and price gouging scams were the greatest threat to consumers, with thousands of complaints levied to her office during 2020.

The top 10 consumer complaints in 2020, according to James’ office:

  • Internet-Related (internet services and service providers, data privacy and security, digital media, data breaches, frauds through internet manipulation): 9,832 complaints;
  • COVID-19 Price Gouging (online and brick and mortar gouging of prices for items such as hand sanitizer, masks, gloves, bathroom tissue, food): 7,701 complaints;
  • Landlord/Tenant Disputes (security deposit releases, tenant-harassment): 2,752 complaints;
  • Health Clubs (continuous charging of fees while clubs were closed, inability to cancel memberships, refunds not provided, no response from clubs): 2,621 complaints;
  • Automobile (sales, service, financing, repairs): 2,561 complaints;
  • Consumer Services (security systems, tech repairs, immigration services, employment training): 2,512 complaints;
  • Retail Sales (any sale of goods: food, clothing, rent-to-own, online orders): 1,609 complaints;
  • Credit (debt collection, credit card billing, debt settlement and debt relief, payday loans, credit repair, credit reporting agencies, identity theft): 1,436 complaints;
  • Utilities (wireless and residential phones, energy servicers and suppliers, cable and satellite): 1,378 complaints;
  • Travel (inability to cancel or lack of refunds for cancellations required by COVID-19 travel restrictions): 1,251 complaints.

James also cautioned about new COVID-19 vaccine scams, fake vaccine cards, and purported cures to the vaccine, which are phony. Puppy scams have also been on the rise in the past 12 months, according to the Attorney General. 

“The havoc unleashed by the COVID-19 pandemic, in addition to the numerous other ways consumers were defrauded in 2020, sadly resulted in my office receiving a record number of consumer fraud complaints in 2020,” James said. “Consumers who have helped identify and report issues to our office have been invaluable partners in our efforts to stop deceptive scams and will continue to be vital partners going forward. 

“I urge all New Yorkers to follow these tips to minimize the risk of falling victim to fraud, but, when fraud does occur, my office will continue to fight to protect New York consumers.”

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Michigan’s Top Ten List of Consumer Complaints for 2020

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From the Office of Michigan’s Attorney General

To celebrate the importance of National Consumer Protection Week and to help people make informed decisions about how to safely spend their money, Michigan Attorney General Dana Nessel today announced Michigan‘s Top 10 Consumer Complaints for 2020. Last year, the Michigan Department of Attorney General received and processed nearly 24,000 consumer complaints.

“Each year, my office tracks consumer complaints to ensure that we’re keeping Michiganders informed on crucial details to protect their wallets,” said Nessel. “A common thread every year is the framework bad actors continue to use, which always includes: a sense of urgency, untraceable payment methods, and an offer too good to be true. The Department of Attorney General is committed to being your connection to consumer protection and I encourage everyone to take advantage of the wealth of resources we have to offer during National Consumer Protection Week and beyond.”

The object of any scam is to steal money or obtain personal information by convincing a victim of the need to part with it. Scammers prey on anyone and use clever tactics to convince their victims to hand over money or personal information through deceit, coercion, intimidation, fear and empty promises. These tactics coupled with a sense of urgency put pressure on the victim to make an immediate decision.

More information on scams can be found online at the Attorney General Consumer Alert page. The Federal Trade Commission (FTC) also has a listing of individual scams with great tips on prevention.

Michigan’s Top 10 Consumer Complaint Categories of 2020:

Nessel’s Top 10 list is compiled by analyzing all complaints filed with the Attorney General’s Consumer Protection Team. Thanks to the hard work of the Consumer Protection Team, the Attorney General’s office was able to recover $517,864.10 in consumer refunds, forgiven debt and other recoveries.

Robocalls (5,516 complaints). As a new category in the top 10, it includes illegal robocalls, telephone solicitations and telemarketing. With the launch of Michigan’s Robocall Crackdown Team in late 2019, Michigan is now recognized as a leader in combatting illegal robocalls. In 2020, Attorney General Nessel joined six other states in filing a major lawsuit against a pair of Texas businesses accused of blasting out billions of illegal robocalls. Rising Eagle Capital Group LLC and JSquared Telecom LLC are both believed to be responsible for more than 42 million illegal robocalls to Michigan residents over a five-month period in 2019 alone.

Price-gouging (4,522 complaints). This is the first time that price-gouging has made the top 10 list. Most consumers reported significant price increases on items such as face masks, gloves, toiletries, food and other items during the COVID-19 outbreak. In 2020, the Attorney General’s office took action against many businesses and individuals seeking to profit from consumer panic during the pandemic.

Retail (2,433 complaints). Retail complaints include purchases that involved late deliveries or products that were never delivered. Other complaints include the purchases of appliances, furniture and other items that were defective or did not work as advertised.

Telecommunications, Cable, and Satellite TV (1,880 complaints). This category includes complaints against wireless communications, cable and satellite TV services with most of the reports being billing and service issues. (NOTE: This category does not include robocalls, which has its own category.)

Internet (1,275 complaints). A significant number of these complaints involve online purchases, as well as computer communications and technology, and internet service providers.

Personal Service Providers (953 complaints). This category covers dating services, beauty companies, fitness facilities, spas, home security and tax preparation services.

Credit and Financial Concerns (880 complaints). This category covers a variety of areas including debt collection and reporting, credit repair, payday lending and mortgage brokering. In 2020, the department settled a lawsuit against tribal officials associated with an online tribal lender that resulted in the lender discontinuing its services to Michigan residents and collecting only outstanding principal amount on remaining active accounts.

Landlord/Tenant (786 complaints). This category involves disputes between renters and apartment owners or property management companies, mobile home parks and site operators, as well as condominium associations. Most complaints report on living conditions and contract disputes.

Motor Vehicle and Automobile (670 complaints). Complaints against used car dealers continue to top this category, followed by auto repair shops, new car dealers and passenger car rentals. This category involves issues from shoddy repair work to service issues.

Travel (547 complaints). This category includes complaints against travel agents, travel clubs, time-shares and time-share exit companies.

“In a year that was unprecedented in many ways, I want to thank our Consumer Protection Team for their resilience and dedication to ensuring that every complaint was addressed,” said Nessel.

Throughout National Consumer Protection Week and the entire month of March, consumers can follow along on the Department’s Facebook, Twitter and Instagram pages for daily consumer protection information.

Your connection to consumer protection is just a click or phone call away. Consumer complaints can be filed online at the Attorney General’s website, or by calling 877-765-8388.



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Division of Consumer Affairs Releases Top Ten 2020 Consumer Complaint Categories

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Tuesday, March 02, 2021 | 11:27am

Nashville- The Tennessee Attorney General’s Office Division of Consumer Affairs (DCA) announced the top ten complaint categories for 2020.

DCA received a total of 4,053 complaints in 2020 and recovered both services and funds for Tennessee by working with consumers and businesses. Overall, the number of consumer complaints decreased slightly in 2020 compared to 2019 when 4,250 complaints were reviewed by Consumer Affairs. The Division’s staff works to quickly route complaints so that appropriate action can be taken in cases where deceptive business practices, frauds or scams are identified.

2020 Top Ten Complaint Categories:

  1. Home Improvements, Home Repair, Home Warranties: 497 complaints
    Home warranties, as well as hiring a contractor for services to repair or improve the quality of your home. The most common complaints involve quality of work, incomplete work after receiving payment, and structural damage caused by employed individuals or businesses. Many of these complaints are referred to the Tennessee Board for Licensing Contractors.
  2. Price Gouging: 343 complaints
    Complaints alleging unreasonable price increases on essential items such as groceries and medical supplies. Price increases are generally considered by evaluating several factors including the pre-existing price agreements and increases in cost by suppliers.
  3. Personal/Professional Services: 329 complaints
    Services offered by professionals working in the State of Tennessee, including hair stylists, massage therapists, locksmiths, exterminators, photographers, surveyors, and others. Common complaints include the quality of service, charges for service not received, and problems redeeming gift certificates for services offered. Complaints in this category are sometimes referred to the TN Department of Commerce & Insurance’s Division of Regulatory Boards and the TN Board of Professional Responsibility.
  4. Landlord/Tenant: 289 complaints
    The most common complaints relate to security deposits and the conditions of the rental property. These complaints are commonly referred to city and county building codes enforcement and the State Fire Marshal’s Office.
  5. Internet Sales: 281 complaints
    Consumer dissatisfaction with items or services purchased online. Common complaints include issues with refunds and returns, or the product or service not being provided after payment. Often, the product or service was solicited via email or social media advertisements. The Division of Consumer Affairs works to mediate these complaints.
  6. Motor Vehicle- Used Sales & Advertising: 266 complaints
    Consumer dissatisfaction with the purchase of used vehicles. Disputes over the vehicle’s condition and deception regarding the sale, advertising, and titling are the most common complaints. Consumer Affairs works closely with the TN Motor Vehicle Commission in this category. In addition, these complaints may be referred to the National Highway Traffic Safety Administration (NHTSA) and the TN Department of Revenue.
  7. Heath Services & Products: 228 complaints
    Complaints include inaccurate billing and misquoting services. The Division may mediate complaints or refer appropriate complaints to the TN Department of Health.
  8. Debtor/Creditor: 225 complaints
    This category includes matters related to debt collection companies, payday loans, credit repair companies, and check-cashing services. Consumers report harassing phone calls or billing issues. These complaints are often referred to the TN Department of Financial Institutions and the TN Department of Commerce & Insurance’s Regulatory Boards Division.
  9. Timeshare/Vacation Clubs: 223 complaints
    Complaints related to the purchase of property under a timesharing agreement and the sale of these agreements. The most common complaints report high-pressure sales tactics, misrepresentation of the contract, and resale scams. The Division will often refer these complaints to the TN Real Estate Commission and the TN Board of Professional Responsibility.
  10.  Travel: 183 complaints
    This category includes consumer disputes involving travel-related issues such as hotel or rental cabin stays. Many complaints involved requests for refunds because of COVID-19.

For more consumer resources, or to file a complaint, visit the DCA website at tn.gov/consumer or contact us at 800-342-8385 or [email protected]

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#21-08:  Division of Consumer Affairs Releases Top Ten 2020 Consumer Complaint Categories

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